Modern Slavery Statement

Modern Slavery Act 2015 (the “Act”)

1. Introduction

npower is committed to ensuring that modern slavery is not present within its business and supply chains.

This is npower’s third slavery and human trafficking statement and sets out the actions we have taken during 2018-2019 to embed processes to support the elimination of slavery risk.

This document represents the Slavery and Human Trafficking Statement for each of the following companies within the npower group of companies (all being subsidiary companies of npower Group PLC):

Npower Limited

Npower Northern Limited

Npower Commercial Gas Limited

Npower Gas Limited

Npower Direct Limited

Npower Yorkshire Limited

collectively (“npower” or the “npower companies”, “we”, “our”).

2. Background to our supply chain

npower is one of Britain’s leading energy companies and is part of the innogy group. npower serves around 4 million residential and business accounts with electricity and gas.

For 2018, npower had a supply chain spend of circa £537m per annum with 623 suppliers. Of our spend 95% sits within the service sector and 80% of that spend sits within our top 10% of suppliers.

We have a diverse supply chain that spans a wide variety of goods and services from suppliers that are both national and international.

3. Innogy Policy relating to Modern Slavery and Human trafficking

Our approach to business reflects our commitment to acting ethically and with integrity in all our business relationships and to implementing processes, policies and controls that seek to eliminate slavery and human trafficking in our business and supply chains.

We support the ten principles of the United Nations Global Compact, including the protection of internationally proclaimed human rights and the elimination of all forms of forced and compulsory labour.

The innogy Code of Conduct reflects the above principles and defines how we conduct our business.

There are three primary objectives to our Code of Conduct:
Firstly, it encourages all employees to take responsibility for their own actions and supports employees with the necessary guidance to meet this.

Secondly, it defines the goals and principles that guide our business activities.

Finally, it sets the standards for collaborating with contractual partners and provides a common basis on which to build contractual relationships.

The innogy human rights declaration, adopted in 2018, sets out the principles of human rights diligence in our activities towards our employees and towards our partners and suppliers. The declaration includes in particular a commitment to freedom of association and a strict rejection of forced, compulsory and child labour. We also demand the same from our suppliers.
The Executive Board of innogy SE is responsible for ensuring that all business activities of the company are in accordance with human rights.

Internal HR Policy

Our HR policies, processes and practices for employees, agency workers or fixed term contractors adopt the core values of the innogy Code of Conduct with all policies detailing the Company’s approach to modern slavery. Our key HR policies include but are not limited to:

Speak Up Policy – We encourage all workers to report any concerns related to our direct activities or supply chains. This includes any circumstances that may give rise to an enhanced risk of slavery or human trafficking. Our Speak Up Policy is designed to make it easy for workers to make disclosures without fear of retaliation. Employees or others who have concerns can use our confidential helpline and email operated by an external provider.

Grievance/Bullying and Harassment – These policies are designed to enable employees to raise and resolve personal concerns that are affecting them, including those relating to slavery or human trafficking.

Disciplinary Procedure – Our Disciplinary Procedure provides a mechanism for dealing with matters of misconduct or breach of the innogy Code of Conduct which relate to slavery or human trafficking.

The innogy Business Services UK Procurement Policy sets out our standards and expectations and forms the baseline from which we seek to achieve compliance and drive continuous improvement in our supply chain. Our Procurement Policy embeds the ten principles of the United Nations Global Compact and the requirements of the UK Modern Slavery Act 2015. A key element to securing compliance in relation to modern slavery risk is our Sustainability Procurement Policy which is the main vehicle for achieving contractual compliance.

The innogy Business Services UK Limited Sustainability Procurement policy captures innogy’s commitment, and the commitment of those with whom it does business, to the respect of and adherence to the principles of Sustainability, Corporate Responsibility, Human Rights, Labour Standards, Anti-Corruption, Respect for the Environment and Health & Safety, as well as the commitment against all forms of Modern Slavery and Human Trafficking.

Our procurement process

Procurement contracts

On entering into any agreement placed by IBS UK Procurement, the Supplier agrees to comply with the values set out in the Sustainability Procurement Policy in addition to the law and, in particular, to support and enact the principles established in the Global Compact Initiative of the United Nations in the areas of Human Rights, Labour Standards, the Environment and Anti-Corruption, as set out at www.unglobalcompact.com.

Procurement due diligence process

Pre-qualification – All suppliers taking part in tender exercises undergo a mandatory pre-qualification process that evaluates their compliance with the Modern Slavery Act and explores the policy and practices in place to ensure that modern slavery is not taking place in their own business and supply chains. Failure to pass the assessment will result in the supplier being excluded from the tender process. We will then liaise with the supplier to discuss how we can support them in making improvements so that they can be invited to take part in future procurement exercises.

In defining a list of tenderers, we reserve the right to exclude any supplier that appears on the World Bank Sanctions Lists and the EU/UN Sanctions Lists. Once a supplier is appointed, our Accounts Payable team checks these lists on a regular basis to identify any supplier subsequently added in which case an investigation is carried out. Our Due diligence Process excludes procurements of low risk and those not of material value.

Risk identification, mitigation and monitoring – Risks relating to modern slavery are identified and assessed at pre-tender and post tender stage, and are mitigated in our contracts. As appropriate, risks are monitored throughout the life of the contract.

4. Our achievements in 2018/2019

We believe that effective management of the risks of modern slavery and human trafficking within the supply chain is effectively managed through the pillars of: good governance, risk management, team development, and collaboration and close working with our supply chain partners.

Good governance – Good governance of our supply chain starts with selecting the right suppliers to work with from the outset. Our Pre-Qualification Process was launched in September 2018 and is used to evaluate all suppliers competing for work of a value of £4,000 and above. We evaluate potential suppliers on the basis of their ability to demonstrate robust processes in the management modern slavery. Where suppliers fail to demonstrate adequate provision we exclude them from the process.

With all excluded suppliers we will share with them our concerns and offer to support them in addressing our issues so that they might be more successful in future procurement exercises.

We have learnt that the pre-qualification enables us to test the supply chain and ensure compliance, we therefore intend to lower the threshold for pre-qualification to cover a greater range of activity.

Risk management – Our procurement process incorporates risk identification and assessment for individual tender exercises. These risks are monitored on our risk register which gives us a holistic view of all significant procurement related risks across our supply chain. Thus we are able to identify and track the risks of modern slavery and human trafficking across our supply chain spend. We are currently developing a risk management tool (due for release in Q4 2019) that will further support the assessment and mitigation of supply chain risks as well as simplifying the process for the ongoing monitoring of potential modern slavery risks.

We have also begun trialing a programme of Strategic Supplier Healthchecks. Through these we are able to conduct a deep dive analysis into some of our key suppliers, and evaluate (among other things) their effectiveness at managing Modern Slavery risk in practice. So far a selection of strategic suppliers have undergone a desktop assessment against a range of key issues including Modern Slavery Compliance. Any resultant concerns have undergone further investigation/potential site audits with the supplier.

The Strategic Supplier Healthchecks have enabled us to explore Strategic Supplier compliance on a range of issues including modern slavery and we therefore intend to run a second phase of Healthchecks – to be launched in September 2019.

Team development – At npower we are really pleased to confirm that in 2018 we gained the CIPs ethical Standard. This standard sets out the values, business culture and practices that organisations must demonstrate such as:

Committing to conducting business with respect, honesty and integrity

Eradicating unethical business practices including bribery, fraud, corruption and human rights abuses, such as modern slavery

Mandating education and training of all staff

Taking steps to prevent, report and remedy unethical practices.

We operate in compliance with the Ethical Standard as we believe that it encapsulates our business values and provides us with a standard against which we can create and apply process for the management of potential modern slavery risks. Maintaining this standard is key to our ongoing sustainability, so on an annual basis, the procurement team will complete the CIPS Ethical Standard training as well as our in-house compliance training.

We have also worked on our induction process to ensure that all new members of the team gain an understanding of the risks of modern slavery and human trafficking in our supply chains. We also provide awareness training for new procurement staff.

Collaboration and close working with our supply chain partners – We recognise that our sphere of influence in the supply chain reduces as we move down the tiers of our supply chain. To gain greater confidence we believe that we need to work with our key supply chain partners to gain control further down the tiers of our supply chain. At our 2018 Strategic Supplier Conference we set out our stance on modern slavery to our supply chain. At this event we challenged all suppliers to work with us on creating a sustainable, slavery free, supply chain.

Unfortunately, due to internal organisation changes and supply chain and market uncertainty, our progress in developing these ideas has been limited. Our long term strategy is to continuously work on our collaboration with our key partners through both our bilateral engagements and through more joint working across the whole supply chain.

5.Tracking our performance

Our key performance indicators (KPIs) measure how effective we have been to ensure that slavery and human trafficking is not taking place in any part of our business or supply chains.

We use the following to monitor the effectiveness of the steps that we are taking to ensure that slavery and/or human trafficking is not taking place within our business or supply chain:

Monitoring the frequency of internal escalation in relation to potential suppliers involved in any tender process. During this statement period, 10 supplier questionnaires (total for all businesses) were referred to the Compliance Team for assessment of tender responses.

Monitoring the instances of current suppliers found to be in breach of requirements relating to the Act. During this statement period, no suppliers were identified as being at risk of a potential breach of the innogy Code of Conduct and therefore no investigations were carried out.

Monitoring the number of new staff who receive training in relation to the requirements of the Act. During this statement period, 17 procurement personnel completed awareness training and 62 Procurement personnel have completed CIPS Ethical training.

7. Authorisations

This statement is made pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes the slavery and human trafficking statement of each of the Npower Companies for the financial year ending 31st December 2018.

This document represents the Slavery and Human Trafficking Statement for each of the following companies within the npower group of companies (all being subsidiary companies of npower Group PLC):

Npower Limited

Npower Northern Limited

Npower Commercial Gas Limited

Npower Gas Limited

Npower Direct Limited

Npower Yorkshire Limited

collectively (“npower” or the “npower companies”, “we”, “our”).

Introduction*

We are committed to ensuring that there is no modern slavery or human trafficking in our supply chains or in any part of our business and to making improvements to our practice where appropriate to meet this commitment. We support the ten principles of the United Nations Global Compact, including the protection of internationally proclaimed human rights and the elimination of all forms of forced and compulsory labour. In npower we apply the innogy Code of Conduct which reflects these principles.

*From the respective boards of each of the npower companies

Our business and organisation structure

Across the npower companies we are a leading supplier of electricity, gas and related goods and services to homes and businesses in the UK. We are a part of the innogy SE (“innogy”) group of companies, a European energy group which has its head office in Germany. With its three business areas of Renewables, Grid and Infrastructure and Retail, it addresses the requirements of a modern, decarbonised, decentralised and digital energy world.

Our UK retail business is supported in its supply chain activities by innogy Business Services UK Limited, an innogy group company that manages procurement activity for the UK retail business.

Our policies on slavery and human trafficking

Our business approach reflects our commitment to acting ethically and with integrity in all our business relationships and to implementing processes, policies and controls that seek to eliminate slavery and human trafficking in our supply chains.

What are we doing to ensure that there is no modern slavery or human trafficking in our own business?

Our HR policies, processes and practices for employees, agency workers or fixed term contractors adopt the core values of the innogy Code of Conduct. Our key HR policies include but are not limited to:

Speak Up Policy - We encourage all workers to report any concerns related to our direct activities or supply chains. This includes any circumstances that may give rise to an enhanced risk of slavery or human trafficking. Our Speak Up Policy is designed to make it easy for workers to make disclosures without fear of retaliation. Employees or others who have concerns can use our confidential helpline and email operated by an external provider.

Recruitment and Selection/Agency Workers/Fixed Term Contract/Contractor Principles Policy - We contract with reputable employment agencies to source labour and, by means of a pre-contract Sustainability Questionnaire (which requests confirmation of policy and process relating to the requirements of the Act) verifies the practices of any new agency it is contracting with before accepting workers from that agency in line with our supply chain processes.

Grievance / Bullying and Harassment - These policies are designed to enable employees to raise and resolve personal concerns including those relating to slavery or human trafficking which is affecting them.

Disciplinary Procedure - Our Disciplinary Procedure provides a mechanism for dealing with matters of misconduct or breach of the innogy Code of Conduct which relate to slavery or human trafficking.

Our supply chains

Our supply chains span a wide variety of goods and services from suppliers that are both national and international.

What are we doing to ensure that there is no modern slavery or human trafficking in our supply chain?

We have zero tolerance to slavery and human trafficking. Consistent with the principles of the UN Global Compact, and in order to identify and mitigate risk of slavery and human trafficking, we have put in place processes in relation to our suppliers to identify, assess and monitor potential risk areas in our supply chains:

For several years, our Procurement Function has imposed obligations on all suppliers it sources and contracts with on our standard procurement terms, relating to compliance with our Code of Conduct (now the innogy Code of Conduct).

In addition, we now apply a Procurement Policy under which our suppliers must meet the requirements of the Act and the innogy Code of Conduct.

References to the requirements of our Procurement Policy are now included in our Sustainability Questionnaire and our standard procurement terms and conditions.

Our Sustainability Questionnaire requests confirmation of policy and process relating to the requirements of the Act. This Questionnaire is used in relation to every new supplier contracted via our Procurement Function except for low risk suppliers and relationships which are not of material value.

Where we contract with suppliers on our standard procurement terms and conditions, we now include provisions requiring compliance by the supplier with the requirements of the Act.

Where we carry out formal tender processes, in defining a bidder group, we now ensure that we do not involve any potential bidder that appears on the World Bank Sanctions Lists (subject to very limited exceptions), or the EU Sanctions Lists. Once a supplier is appointed, our Accounts Payable team checks these lists on a regular basis to identify any supplier subsequently going onto a list in which case an investigation is carried out.

We now obtain bidder confirmation during formal tender processes, that there is no risk of slavery in their organisation or their supply chain.

We will continue to look at how we can better identify and mitigate risks of slavery and human trafficking in our supply chains.

Training

To ensure a high level of understanding of the risks of modern slavery and human trafficking in our supply chains and our business, we have introduced awareness training to new procurement staff.

Our effectiveness in combating slavery and human trafficking

We are developing key performance indicators (KPIs) to measure how effective we have been to ensure that slavery and human trafficking is not taking place in any part of our business or supply chains.

Our performance indicators

We will use the following to monitor the effectiveness of the steps that we are taking to ensure that slavery and/or human trafficking is not taking place within our business or supply chain:

Monitoring the number of new staff who receive training in relation to the requirements of the Act

Monitoring the frequency of internal escalation to our Corporate Responsibility Manager in relation to potential suppliers involved in any tender process

Monitoring the instances of current suppliers found to be in breach of requirements relating to the Act

This statement is made pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes the slavery and human trafficking statement of each of the Npower Companies for the financial year ending 31st December 2017.

This document represents The Slavery and Human Trafficking Statement for each of the following companies within the npower group of companies (all being subsidiary companies of npower Group PLC):

Npower Limited

Npower Northern Limited

Npower Commercial Gas Limited

Npower Gas Limited

Npower Direct Limited

Npower Yorkshire Limited

collectively (“npower” or the “npower Companies”, “we”, “our”).

Introduction*

We are committed to ensuring that there is no modern slavery or human trafficking in our supply chains or in any part of our business and to making improvements to our practice where appropriate to meet this commitment. We support the ten principles of the United Nations Global Compact, including the protection of internationally proclaimed human rights and the elimination of all forms of forced and compulsory labour. In npower we apply the innogy Code of Conduct which reflects these principles.

*From the respective boards of each of the npower companies

Our business and organisation structure

Across the npower companies we are a leading supplier of electricity, gas and related goods and services to homes and businesses in the UK. We are a part of the innogy SE (“innogy”) group of companies, a European energy group which has its head office in Germany. With its three business areas of Renewables, Grid and Infrastructure and Retail, it addresses the requirements of a modern, decarbonised, decentralised and digital energy world.

Our UK retail business is supported in its supply chain activities by innogy Business Services UK Limited, an innogy group company that manages procurement activity for the UK retail business.

Our policies on slavery and human trafficking

Our business approach reflects our commitment to acting ethically and with integrity in all our business relationships and to implementing processes, policies and controls that seek to eliminate slavery and human trafficking in our supply chains.

What are we doing to ensure that there is no modern slavery or human trafficking in our own business?

Our HR policies, processes and practices for employees, agency workers or fixed term contractors adopt the core values of the innogy Code of Conduct. Our key HR policies include but are not limited to:

Speak Up Policy - We encourage all workers to report any concerns related to our direct activities or supply chains. This includes any circumstances that may give rise to an enhanced risk of slavery or human trafficking. Our Speak Up Policy is designed to make it easy for workers to make disclosures without fear of retaliation. Employees or others who have concerns can use our confidential helpline and email operated by an external provider.

Recruitment and Selection/Agency Workers/Fixed Term Contract/Contractor Principles Policy - We contract with reputable employment agencies to source labour and, by means of a pre-contract Sustainability Questionnaire (which requests confirmation of policy and process relating to the requirements of the Act) verifies the practices of any new agency it is contracting with before accepting workers from that agency in line with our supply chain processes.

Grievance / Bullying and Harassment - These policies are designed to enable employees to raise and resolve personal concerns including those relating to slavery or human trafficking which is affecting them.

Disciplinary Procedure - Our Disciplinary Procedure provides a mechanism for dealing with matters of misconduct or breach of the innogy Code of Conduct which relate to slavery or human trafficking.

Our supply chains

Our supply chains span a wide variety of goods and services from suppliers that are both national and international.

What are we doing to ensure that there is no modern slavery or human trafficking in our supply chain?

We have zero tolerance to slavery and human trafficking. Consistent with the principles of the UN Global Compact, and in order to identify and mitigate risk of slavery and human trafficking, we have put in place processes in relation to our suppliers to identify, assess and monitor potential risk areas in our supply chains:

For several years, our Procurement Function has imposed obligations on all suppliers it sources and contracts with on our standard procurement terms, relating to compliance with our Code of Conduct (now the innogy Code of Conduct).

In addition, we now apply a Procurement Policy under which our suppliers must meet the requirements of the Act and the innogy Code of Conduct.

References to the requirements of our Procurement Policy are now included in our Sustainability Questionnaire and our standard procurement terms and conditions.

Our Sustainability Questionnaire requests confirmation of policy and process relating to the requirements of the Act. This Questionnaire is used in relation to every new supplier contracted via our Procurement Function except for low risk suppliers and relationships which are not of material value.

Where we contract with suppliers on our standard procurement terms and conditions, we now include provisions requiring compliance by the supplier with the requirements of the Act.

Where we carry out formal tender processes, in defining a bidder group, we now ensure that we do not involve any potential bidder that appears on the World Bank Sanctions Lists (subject to very limited exceptions), or the EU Sanctions Lists. Once a supplier is appointed, our Accounts Payable team checks these lists on a regular basis to identify any supplier subsequently going onto a list in which case an investigation is carried out.

We now obtain bidder confirmation during formal tender processes, that there is no risk of slavery in their organisation or their supply chain.

We will continue to look at how we can better identify and mitigate risks of slavery and human trafficking in our supply chains.

Training

To ensure a high level of understanding of the risks of modern slavery and human trafficking in our supply chains and our business, we have introduced awareness training to new procurement staff.

Our effectiveness in combating slavery and human trafficking

We are developing key performance indicators (KPIs) to measure how effective we have been to ensure that slavery and human trafficking is not taking place in any part of our business or supply chains.

Our performance indicators

We will use the following to monitor the effectiveness of the steps that we are taking to ensure that slavery and/or human trafficking is not taking place within our business or supply chain:

Monitoring the number of new staff who receive training in relation to the requirements of the Act

Monitoring the frequency of internal escalation to our Corporate Responsibility Manager in relation to potential suppliers involved in any tender process

Monitoring the instances of current suppliers found to be in breach of requirements relating to the Act

This statement is made pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes the slavery and human trafficking statement of each of the Npower Companies for the financial year ending 31st December 2016.

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